Alabama Database Will Make It Easier to Verify Proof of Coverage

After winning overwhelming support from lawmakers, a proposal to establish an electronic database that will match up cars to valid insurance policies gained final approval from Alabama Gov. Robert Bentley last week.

The new law will give Department of Revenue and law enforcement officials greater ability to verify existence of coverage in a state where an estimated 22 percent of motorists lack car insurance.

Once the verification system is up and running, law enforcement officers will be able to verify proof of coverage from in the field, and workers at the Department of Revenue will be able to check on coverage status before allowing vehicle owners to register or re-register their autos.

The legislation also makes coverage verification a necessity prior to registration. Currently, vehicle owners are required only to sign a statement at the time of registration saying that they have coverage in place that meets minimum standards for mandatory auto insurance in Alabama.

Regulators will assemble an advisory council to develop a plan of implementation and to ensure quality control for the verification system. It will comprise 13 voting members representing insurers, the Department of Revenue, the Department of Public Safety, the Department of Insurance, the Alabama Probate Judges Association and four insurer groups.

The council will help with development, the initial testing phase and recommendations on an annual basis.

Text of the legislation says that the verification system should be fully functional by 2013.

About Ben Zitney

Benjamin Zitney has been covering the auto insurance industry for the past 2.5 years. Before coming to Online Auto Insurance News, he produced an extensive company history of the 30-year-old California Joint Powers Insurance Authority and worked at the Cal State Long Beach Daily Forty-Niner as a reporter, copy editor and news editor.